Obama Needs to Channel Richard Nixon

Nixon's the one to emulate.

I just listened to President Obama's latest pronouncement on the economy, delivered live on CNN. All good stuff, as usual. But with one element missing: Obama again didn't say anything that was particularly helpful to the markets. As a matter of fact, it may be unrelated but the market declined during his remarks.

What's missing is the kind of helpful nudge that came from none other than Richard Nixon in 1970, during the depths of what then seemed like a pretty deep recession. Nixon said: “Frankly, if I had any money, I’d be buying stocks right now.” The market soared.

Roger Cohen archly suggested in the New York Times in October that if Bush said that, "the market could tank in ways that would make this week’s one-day 777 point plunge look paltry." Maybe, but I'd like to see Obama give it a try. What has he got to lose? Things can't get much worse. Besides, he has only a 50% chance of being wrong.

UPDATE: Obama must be channeling me, because he talked up buying stocks (albeit in his usually carefully hedged manner) in an impromptu press briefing a couple of hours after this item appeared. I think that he needs to make that point again during one of his addresses to the nation, and he needs to sing out loud and strong "buy stocks!" Just as Warren Buffett did a few months ago, to no effect.

© 2009 Gary Weiss. All rights reserved.

Are We Ready to Surrender Just Yet?

Time to surrender, don't you think?

Lawrence Fink of BlackRock says so, and he means it in a nice way, which is a sign of the times I guess.

Bloomberg reports:

BlackRock Inc. Chief Executive Officer Laurence Fink said he's seeing signs of ``capitulation'' in financial markets, a broad selloff that usually proceeds the end of a bear market.

``A year ago, I said we won't see a bottom until we see a capitulation,'' Fink, whose company is the largest publicly traded asset manager in the U.S., said today at an investment conference in New York. ``We are seeing a capitulation'' and financial markets may begin to recover by mid-2009, said Fink, 56.

Me, I'm a pessimist. I think this market's got a lot of fight left in it. Surrender? Hell no! This market is filled with piss and vinegar, and will die rather than capitulate.

Yessirreeeebob.

© 2008 Gary Weiss. All rights reserved.

When Will Patrick Byrne Stop Lying?

And when will the media call him on his lies?

Overstock.com's wack-a-doo CEO Patrick Byrne has been telling every journalist naive enough to swallow his hokum that he "predicted" the current economic calamity. His latest blatherings came today on CNN.

There was this exchange:

.....How did you know the train was coming?

BYRNE: Well, boy, you do your homework. Yes, if you go on YouTube and YouTube my name, you'll see all these videos where I've been saying that.

Basically, every drinking binge I've ever seen ends in a hangover. Well, every expansion, every boom that's fueled by cheap credit ends in a collapse like this. So it's been sort of four or five years, it's been pretty clear this is coming, coupled with there's rampant stock manipulation on Wall Street that's just made the system more brittle.

Byrne, of course, has not uttered a word about "cheap credit," subprime mortgages or Fannie or Freddie or any other actual factor in the recent unpleasantness.

Indeed, Byrne's fellow naked shorting conspiracy theorists, notably blogger Phil Saunders, mercilessly pumped NovaStar Financial -- a leading subprime lender -- claimed that it was a victim of naked shorting and not its own profligate lending, and attacked critics of that company. They'd continued to do so as it slid toward bankruptcy. with Saunders flailing away on a website he created, nfi-info.net. As a commenter points out, Byrne once touted that doomed subprime lender as an "awesome firm."

Instead, Byrne's blatherings over the years have been incoherent rants about "Sith Lords," "hedge fund conspiracies" (notwithstanding his own background in the hedge fund biz), and "counterfeit stock," and there is of course not a shred of evidence that any such things caused the market calamity.

His 2005 contention that a "Sith Lord" -- a mastermind from the 1980s -- was conspiring against good CEOs like him has turned out to be a figment of the imagination of a very truth-challenged corporate exec.

His main preoccupation, of course, has been attacking people who dare to criticize him or say nice things about people he doesn't like, most recently in a vulgar, homophobic tirade.

In fact, the CNN interviewer apparently wasn't listening very carefully, because she let a nutty Byrne attack on Joe Nocera of the New York Times pass without comment. If CNN was a bit more wide awake, it would have realized there was something not quite right about the person it was interviewing and cut him off right there.

So I guess the question is, when will Patrick Byrne stop misrepresenting his past statements? When will he stop lying? The answer, of course, is "never," so I guess the next question is, will the supply of naive journalists giving a podium to this snake oil salesman ever end?

UPDATE: More on Byrne's con game, from Tracy Coenen.

© 2008 Gary Weiss. All rights reserved.

Does Everybody Know?

Until the market spasm today, I was beginning to think that the stock market was acting in sync with Leornard Cohen's "Everybody Knows."

Everybody knows that the dice are loaded
Everybody rolls with their fingers crossed
Everybody knows that the war is over
Everybody knows the good guys lost
Everybody knows the fight was fixed
The poor stay poor, the rich get rich
Thats how it goes
Everybody knows

Everybody knows that the boat is leaking
Everybody knows that the captain lied
Everybody got this broken feeling
Like their father or their dog just died

Today I told a professional investor of my acquaintance that I was heavily invested in index funds, and he started talking to me like my dog just died. That (and the Sundance Channel) reminded me of the Leonard Cohen song.

See, that's the market for you. Everybody knows the boat is leaking, even if today there seems to be a patch.

© 2008 Gary Weiss. All rights reserved.

Journalists Need to Show Skepticism on the Mega-Bailout

Pulitzer winner and former New York Times reporter David Cay Johnston today posted an appeal for skepticism in the Romenesko journalism website.

Johnston writes:

In covering the proposed $700 billion bailout of Wall Street don't repeat the failed lapdog practices that so damaged our reputations in the rush to war in Iraq and the adoption of the Patriot Act. Don't assume that Congress must act instantly, as so many news stories state as if it was an immutable fact. Don't assume there is a case just because officials say there is.

The coverage of the Paulson plan focuses on the edges, on the details. The focus should be on the premise. And be skeptical of what gullible Congressional leaders, most of them up before the voters in a few weeks, say after being given a closed-door meeting on supposed horrors.

Johnston suggests some specific questions, including:

How does banning short selling of the stocks of 900 companies help the markets? (The markets are heavily biased toward the sell side, so why constrain the shorts, who often turn out to be right about stocks whose share prices has been artificially inflated.)

How is banning short selling of this growing list of companies show a commitment to "free markets," a stated goal of this and a long lost of previous administrations?

During this short selling ban, why are there no parallel controls on insiders getting out of their positions?

I would add to this list, as I suggested yesterday, why not simply reinstate the uptick rule rather than eliminate all shorting?

Coverage of the bailout has not been terrible, but Johnston is right -- more skepticism is needed, lest the media wind up complicit in yet another Iraq-style deception.

© 2008 Gary Weiss. All rights reserved.

The Market Astounds

Stock market writers are going to have to figure out what happened today. I pity them, because I for one haven't the foggiest idea.

All I can say is that I've never seen anything like it.

But I do want to take this opportunity to clap myself on the back, because I made what is probably the only well-time trade in my life. Early this afternoon I bought fifty index Spiders (the S&P 500 index product) for my self-managed IRA at $127.69, and they closed at $133.79. Hey, if I repeat this 10,000 times I could make a living at this!

© 2007 Gary Weiss. All rights reserved.

Today's Market Commentary

At the bell....



© 2007 Gary Weiss. All rights reserved.

The Market Undergoing a 'Full-Press Leotardo'

Over the past couple of days, the market has been roughly in the position of Phil Leotardo. As fans of The Sopranos will recall, Phil Leotardo was the mob boss whose head was crushed by his car.

I feel sorry for stock market writers, who have to figure out new and better ways of quantifying the pain wrought by mortgage backed securities. What happened was quite simple but complex in the details, and it makes for some dull writing.

Thus an AP writer says this afternoon that "Wall Street headed into its final hour of a volatile week down but off its lows after the Federal Reserve said it would for the third time inject liquidity into the banking system. The afternoon move made for jittery stocks, perhaps raising the notion that troubles in the credit market are worse than perceived."

An easier way of translating that would be that "Wall Street's head was being crushed by an SUV this afternoon." But that would not be consistent with the AP stylebook.

© 2007 Gary Weiss. All rights reserved.



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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site, gary-weiss.com.

My Market Forecast

My official market forecast is that the Dow will close at 12447.52 on March 21.

I believe this may have to do with the first day of Spring, or maybe the Fed, or perhaps traders reacting to traders reacting to traders reacting to the Fed.

That's all one really knows, except that it is awfully nice! Anyone who says otherwise is full of beans.

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.

It is Officially a Thin Lizzy Market

I just notice that according to the wire services, what we have now is a Thin Lizzy Market. I.e., it is "fighting its way back."

"I'm tough, rough, ready and able
To pick myself up from under this table
Don't stick no sign on me, I got no label
I'm a little sick, unsure, unsound and unstable

But I'm fighting my way back..."

I'd prefer to be in a Sideways market.

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.

Another Sideways Market

Another sideways day in the market, thereby giving me an excuse to trot out another variation on the use of the word "sideways" in popular culture.

This one was in the New York Times today, in an article on the late Jerry Orbach:

“As Jerry would say, onwards and sideways.”

(By the way, I really wish they'd name that street corner after the man.)

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.

Stocks and Sideways

The Associated Press just reported that "stocks move sideways in midday trading." I won't provide a link because it will be dead soon. (The link, that is, not the market.)

I wonder if the AP writer was thinking, perhaps subconsciously, of a line from the movie Sideways. The market today is "quaffable, but far from transcendent."

That reminds me of another way to celebrate the rally/cure the market blues:



UPDATE FOR DEALBREAKER READERS: Sorry folks, that's all I said in this item. Click here for more blog items. Click here if you want to buy my book. Click here if you want to buy some great chocoloate.

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.

My Sure-Fire Ways to Celebrate the Market Rally (if it doesn't fade)

One possible method of celebrating

I have several suggestions for people interested in celebrating today's rally (if it doesn't fade):

1. Dive into a box of See's chocolates. Approximately three pieces left of the two-pound box I mentioned last week. (See conflict of interest disclaimer.)


2. Have a good laugh. Read Patrick Byrne's latest lie. (New link!) Or read Overstock.com resident stalker Judd Bagley's latest excuse for his "Omuse" make-work project.

3. Say to yourself, "Happy me. I almost sold my New Century Financial shares yesterday."

4. If you're a NovaStar Financial shareholder, say to yourself, "Happy me!" Say it again. "Happy me!" Say it again.

5. The NovaStar shareholder quoted in #4 is on heroin.


Yet another

Earlier post: My Sure-Fire Cures For the Market Blues.

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.

My Sure-Fire Cures For the Market Blues

One possible remedy

I have several suggestions for people interested in curing the market blues:

1. Dive into a box of See's chocolates. Approximately a half-pound left of the two-pound box I mentioned last week. (See conflict of interest disclaimer.)


2. Have a good laugh. Read Patrick Byrne's latest lie. (Here's a response from a soon-to-be-former member of the Investor Village stock-pump website.)

Or read Overstock.com resident stalker Judd Bagley's paranoid ravings on Wikipedia yesterday afternoon, before getting himself kicked off.

3. Think to yourself, "It could be worse. I could be a New Century Financial shareholder."

4. If you're a New Century Financial shareholder, think to yourself, "It could be worse. I could be a NovaStar shareholder."

5. If you're a NovaStar shareholder, try heroin.


Yet another

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.